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With the upcoming elections, monitoring of financial transparency of political parties and associated individuals, and lawfulness of their expenditures become a matter of concern. Regulation of these issues is linked to important matters like equal electoral environment, competition and stable political system in the country. 

A new political player has emerged in the political playing field of Georgia. His name is Leonid Chernovetsky and he has been implementing both political and charity activities through two different foundations. 

We should also consider Paata Burchuladze’s work, as his political plans for the future have been the subject of public speculations. Although unlike Leonid Chernovetsky, Mr. Burchuladze has not publicly announced his intention to run in the elections, ‘Paata Burchuladze – Georgia’s Development Foundation’ is actively involved in different areas of public life. 

Simultaneous political and charity work is prohibited under Georgian legislation. In particular, if an individual intends to run in elections, he or she must state this publicly and subject himself/herself to financial monitoring for political parties. In addition, s/he must stop any type of charity work; otherwise, it will be considered vote buying. 

As of now, the State Audit Office (SAO) subjected only one of the foundations of Leonid Chernovetsky to the financial monitoring for political parties – Union for Happy Georgia, while another one of his charity foundation – Social Partnership is not subject to monitoring. As to Mr. Burchuladze, his Foundation for Development of Georgia is not subjected to monitoring; neither are his charity activities because he has not made any public announcement about participation in elections.

Procedures for determining persons with electoral goals

In addition to political parties and candidates, there are persons (both physical and legal), who may not be registered as a political party but may be carrying out activities similar to those of a political subject. These individuals, similar to political subjects, are subject to financial monitoring by the SAO.  

In order for a person to be subject to the SAO financial monitoring, the following two conditions must be met: 

• publicly announced political/electoral goal;

• use of financial and material resources to achieve electoral goals; 

Person’s declared political goal should be expressed through a public statement and be directed towards formation of public opinion, illustrating person’s desire to come into power through elections.1 The statement should be public, meaning that it should be made by disseminated by media, means of mass communication or public events. 

Next is use of material and financial resources of the person to advance electoral goals – i.e., when the person is using resources to advance electoral goals to influence public opinion. 

If foregoing grounds for deeming a person as a subject of political parties’ financial monitoring are detected, the SAO should institute administrative proceedings. 2 If administrative proceedings prove that the person has declared electoral goals and is using financial and material resources to advance these goals, the SAO will issue an individual administrative/legal act and will recognize the person as a subject of financial monitoring.4 

A person subjected to monitoring is also subjected to the obligations of transparency and lawfulness of expenditures for political parties, foreseen by the Organic Law of Georgia on Political Unions of Citizens. 

Charity work carried out by persons with political goals will be considered vote buying. 

Charity work by Leonid Chernovetsky

On February 10, 2016, the SAO stated that the foundation Union for Happy Georgia is an entity with declared electoral goals4 and subjected it to the restrictions foreseen by the Law of Georgia on Political Unions of Citizens for political parties. Mr. Chernovetsky’s name is also associated with charity foundation Social Partnership, which the SAO did not subject to the financial monitoring. 

Connection between Mr. Chernovetsky and the foundation Social Partnership is proved by the following: 

• Mr. Chernovetsky has publicly discussed activities carried out by the foundation, without trying to hide the connection between him and the foundation; 

• Public Registry records establish that the current director of the foundation for Happy Georgia Giorgi Kvrivishvili also served as a director of Social Partnership up until February 10. Mr. Kvrivishvili left his position at the Social Partnership around the time financial monitoring service declared the Foundation for Happy Georgia as a subject with electoral goals. 

As noted above, one of Mr. Chernovetsky’s foundations (Union for Happy Georgia) is subject to monitoring, while another foundation (Social Partnership) is not. 

In light of the foregoing, if Mr. Chernovetsky continues to be associated with the foundation’s activities, projects carried out by the Social Partnership may be viewed as violation of Article 252 of the organic law of Georgia on Political Unions of Citizens, amounting to vote buying. 

Article 1641 of the Criminal Code qualifies vote buying as a crime punishable by deprivation of liberty for up to three years or by fine. 

Charity work of Paata Burchuladze

In light of the upcoming elections, it is interesting to consider the work of ‘Paata Burchuladze – Foundation for Development of Georgia. The manager and other members of the foundation are making political statements and are actively opening offices of the foundation throughout Georgia. In addition, Paata Burchuladze cancelled all of his opera contracts for the upcoming election period. Although f Paata Burchuladze and his foundation are engaged in activities with political overtones, while the foundation’s plans for the upcoming elections have been the subject of public speculations, neither Paata Burchuladze nor his foundations have publicly announced about their plans to participate in the 2016 parliamentary elections. There fore, the SAO has no formal grounds to institute proceedings into the foundations’ activities. 

Because Mr. Burchuladze doesn’t have any officially declared electoral goals, activities of ‘Paata Burchuladze’s International Foundation Iavnana’ are not subject to the legal regulations. Therefore, if Paata Burchuladze’s Foundation for Development of Georgia participates in elections and he will declare about it shortly before the elections, activities of both of his foundations will remain beyond the scope of the legal regulation, which is a serious problem in terms of vote buying. 

Conclusion

On February 10, 2016, the State Audit Office applied to all physical and legal persons to register with the Service if they plan to participate in the upcoming parliamentary elections. The SAO’s announcement is an important message for all subjects who are not registered as a political party but have been acting and spending resources for winning the 2016 parliamentary elections.

It is important to comply with the SAO’s requirements, in order to prevent any threats of political corruption and destabilization of political institutes; all political subjects should have access to a level and competitive playing field, which will promote free and fair environment for the upcoming elections. 

Recommended Next Steps

• With respect tot Mr. Chernovetsky’s foundations, the SAO should look into the possible signs of vote buying; upon detection of any violation, the SAO should refer the case to the prosecution. 

• All individuals who plan to participate in the 2016 parliamentary elections, should register with the SAO in a timely manner, in order to ensure transparency of its finances and lawfulness of its expenditures. 

1. Organic Law of Georgia on Political Unions o Citizens, Article 71  

2.   Organic Law of Georgia on Political Unions o Citizens, Article 341 para.2(l)

3.   Organic Law of Georgia on Political Unions o Citizens, Article 341 para.2(l)

4.   The Foundation is subject to the obligation about transparency if incomes and financial reporting; in addition, representatives of the foundation are prohibited from providing any material or non-material objects to citizens of Georgia (except for campaign promotional materials). Otherwise, the activity will be considered vote buying.